Three Picks for a Potential Gold Rally

Sterne Agee rates Newmont, Agnico Eagle and Coeur at Buy.

Sterne, Agee & Leach

We think the current gold price appears to be discounting a successful and smooth Federal Reserve exit from extraordinary monetary accommodation, which appears unlikely. Sharply lower capital spending, cyclical demand recovery, excess monetary liquidity, reserves and a potential return of monetary velocity could set up a sharp price and valuation recovery among mining equities.